Trudeau calls Trump's trade tariffs against Canada 'insulting and unacceptable'

This has been bugging me for a while now. I mentioned it in another thread but it didn't seem to get much traction there, so let's give it its own thread.

First, the article:

Trudeau calls Trump's trade tariffs against Canada 'insulting and unacceptable'

Before we dive into it, let's keep one thing in mind. Tariffs are paid by the importer not the exporter. In this case the US has put tariffs on aluminum and steel from other countries. The exporters can still make and sell their metals for the same price. The only way this has a detrimental effect on the exporter is if the importer buys less because of the increased price.

But in the US, there is still the demand for the metals. We need it, so if we have to pay more we will. If we can't produce enough on our own them we'll have to import it. The only reason we would import less is because we didn't need it.

So, theoretically, tariffs should have no effect on an exporter who is making a quality product and selling it for a reasonable price when there is a demand for that product.

Now, let's look at some statements in the article:

In a sharp rebuke from one of America’s closest allies, Canadian Prime Minister Justin Trudeau criticized the White House rationale for imposing punitive trade tariffs on Canada as “insulting and unacceptable,” the latest leader to warn of a looming trade war with the U.S.

First of all, I think I speak for most Americans when I say it is not up to foreign leaders to tell us our laws or economic policies are "acceptable." Second, I honestly don't understand how a tariff is an insult. One is an economic decision, the other starts with "Yo Mama so ..."

In imposing them, Trump invoked a little-used provision in the law that permits the use of tariffs to counter a national security threat.

Trudeau denied on NBC’s “Meet the Press” that Canada or its steel and aluminum industries posed any such menace. Canada is one of America’s largest trading partners and one of its closest military and political allies.

“The idea that we are somehow a national security threat to the United States is, quite frankly, insulting and unacceptable,” Trudeau said.

Here's what I see. Trump wanted the tariffs. He knew he had little chance of getting Congress to do it. So he found a legal loophole and did it himself. Trump wasn't sitting around randomly thinking, "How can I insult Canada?" These tariffs apply to other countries as well. And, as I previously stated, the tariffs should have no economic effect on the exporting nation.

He said Canada would impose retaliatory tariffs against American-made steel and aluminum, as well as on other goods. Officials have said cheese, whiskey, orange juice and dozens of other items will be targeted, many from states that Trump won in 2016, in an effort to pressure him to reverse course.

I just want to point out here that Mr. Trudeau seems to be making an economic decision based on "retaliation." If you are going to make an economic decision for your country, it should be based on whether on not it helps your economy. Retaliation should not be a factor. If tariffs help your country, do it. If not, don't. And if they do help your country, why haven't done them before?

"We're putting the same kinds of tariffs exactly on steel and aluminum coming from the United States into Canada to be directly reciprocal," Trudeau said.

Wait a minute. We're buying steel from them and they're buying steel from us? That hurt my head a little. How about we use our steel and you use yours and we save on tariffs and shipping costs. Or is this all about keeping the shipping industry in business?

"But we're also putting a number of tariffs on consumer goods, finished products for which Canadians have easy alternatives."

Again, why weren't you doing this before? Aren't you supposed to be doing what's best for Canada?

The confrontation, he warned, will hurt consumers and workers on both sides of the border.

Well, it will now. Before, it was just US importers and consumers being hit in the pocket book. Thanks to you, Canadians will, too. Nice job at retaliation, eh?

“Economic nationalism leads to war,” he [French President Emmanuel Macron] warned.

One of those rare example when the MSM tells you a truth they would rather you didn't know. I'll leave it to the reader to ponder the implications of that statement.

---------

Of course, my comments are base on my reasoning that tariffs should have no economic effect on an exporter producing a product that's in demand for a fair price. The cost is paid by the importer. If anyone sees a flaw in that, please share.

So, why would an exporter consider a tariff insulting or unacceptable? How do retaliation tariffs help your economy or your people? Who is really behind this opposition to US tariffs?

a reply to: VictorVonDoom

So, theoretically, tariffs should have no effect on an exporter who is making a quality product and selling it for a reasonable price when there is a demand for that product.

So, why would an exporter consider a tariff insulting or unacceptable?

Because the exporter will sell less of their product because the price to the buyer will be higher. Basic economics. Price goes up, demand goes down.

First of all, I think I speak for most Americans when I say it is not up to foreign leaders to tell us our laws or economic policies are "acceptable."

But the vice is versa?

a reply to: VictorVonDoom


Did Trudeau (Canada) sneak inferior Chinese steel into the U.S.?

originally posted by: Phage

Because the exporter will sell less of their product because the price to the buyer will be higher. Basic economics. Price goes up, demand goes down.

Why does demand change? If you need steel, you buy steel. If you don't need it, you don't buy it. If you make a product with steel, you pass the cost along to the consumer. Are we buying steel we don't need?

originally posted by: Phage
But the vice is versa?

I can't claim to speak for most Americans on that, but I would say definitely not.

a reply to: VictorVonDoom

Foreign steel imports costs less than domestic steel because it costs more to make those steel products in the US. If the cost of foreign steel rises less of it will be bought. Meanwhile, US steel producers can raise their prices because foreign steel costs more. And we're not talking about Wilbur's stupid soup can.

The World Trade Center was built with about 200,000 tons of steel. In January of this year the price of steel was about $700/ton. A 20% increase in the price of steel would mean that the steel to build another World Trade center would cost about $25 million more.

The only benefit will be to the US steel industry. Other industries, and the consumers, will pay the price and foreign producers will sell less steel.

a reply to: VictorVonDoom

Your right it only effects the importers but the reason Canada is upset is because tariffs are designed to lower demand for that product. So if we have a Steele tariff less Canadian Steele will be purchased by US companies. Meaning demand goes down and that does effect the exporting country.

Now what I find funny is Canada has used tariffs against the US for example in oil drilling. The other thing is they have quotas for produce. And use this to restrict how much food can be brought into canada. And what they do with grains such as wheat is crazy. They passed a law that says to use grains for humans they have to be certified. But the catch is the only way to get certification is to grow it in canada meaning U.S. wheat and barley cant be certified and cant be used for milling.

a reply to: Phage

And where does that $25 million go? Towards paying off the National Debt. It would have cost more, the government gets money as a kind of tax, and the buildings are still built. So how does that hurt the exporter? It wouldn't have cost them an extra dime.

If at some point US manufacturing can produce enough steel to meet demand matching the import price plus the tariffs, then all the money stays in the US. That sounds like a good economic decision for the US.

Messed up post.

a reply to: dragonridr

But the catch is the only way to get certification is to grow it in canada meaning U.S. wheat and barley cant be certified and cant be used for milling.

Not exactly.
Canada restricts the varieties of wheat which can be imported. It turns out that the US doesn't grow many of those varieties. It's sort of like not allowing the importation of GM crops, but of course, there is no GM wheat.
www.inspection.gc.ca...

a reply to: dragonridr

I would say that's a good thing. Canada has plenty of wheat and maybe they don't want GMOs mixing with their clean grain. I should add that modified wheat is a lot different than it was 60 years ago, or so. This seems to be nothing more than a tariff war, just because. Wheat today is short grain and not very healthy for consumption.

a reply to: VictorVonDoom

And where does that $25 million go? Towards paying off the National Debt.

So, it's a tax increase on everyone who uses steel. Fair enough.

So how does that hurt the exporter? It wouldn't have cost them an extra dime.

They will sell less of their product.

And I don't see how the exporters would be selling less steel. The US is not the only consumer. Steel is in demand worldwide.

Then you don't understand basic economics. The less something costs, the more you sell. That's one reason that the US does not export as much steel as it might, it costs more to make. A tariff is an artificial price manipulation. One that helps a single industry at the expense of all the others.

a reply to: PillarOfFire

There is no commercially grown GM wheat in the US.

a reply to: Phage

Yeas.. I was thinking more of the modified wheat from a few decades ago when I said that. When it was still healthy to consume.

This .. www.healthline.com...

Protecting our manufacturing of strategic resources like steel is important for our domestic defense industry. Since Canada benefits from the US military by not having to have the expense of a viable military of their own I think Trudeau should either shut up or better yet say thank you.

originally posted by: Phage
a reply to: VictorVonDoom

Then you don't understand basic economics. The less something costs, the more you sell. That's one reason that the US does not export as much steel as it might, it costs more to make. A tariff is an artificial price manipulation. One that helps a single industry at the expense of all the others.


Im not sure thats true for necessary items, luxury goods sure.
Think about razors or tampons, both necessary items and regardless of price rises people are going to buy them because their arent really any alternatives

I never understood why trade was allowed with products that countries have an excess of, why import oranges if your country grows enough to export?

Free trade/open trade doesnt benefit citizens or consumers, it benefits corporations that have the ability to mass produce and then ship globally.

I personally think everything a country itself produces but still imports should be taxed/tariffed unless the imported product is superior to the locally produced one

a reply to: Metallicus

You have to remember, that until Mr. Donald Trump came into office, everyone in the free world was part of the" In Group ". So what we are witnessing right now is the scramble to gain back what they lost, which is Control. There's a lot of puppets in the game, but only 5 Masters wielding the puppet strings. If they don't do what they are told they get offed along with their family and friends.

The GameMasters don't play by the same rules they instill on our Leaders.

originally posted by: Phage
a reply to: VictorVonDoom

Then you don't understand basic economics. The less something costs, the more you sell. That's one reason that the US does not export as much steel as it might, it costs more to make. A tariff is an artificial price manipulation. One that helps a single industry at the expense of all the others.

Here's what I do understand. It's not price and demand. It's supply and demand. Price is determined by supply and demand. Yes, a tariff is an artificial price manipulation. That's not exactly new in the US. We tax gas, cigarettes, alcohol and many other things as much for enforcing desired behaviors as revenue. But the price will always be proportional to the supply and demand.

If I want to build a garage and I can only afford 75% of the lumber I need, then I don't build a garage. If the price of the lumber was low enough that I could buy twice what I needed, I don't buy twice the lumber. If the US requires a certain amount of steel, that's what we will buy. The price will be determined by the supply plus the tariff. We pay the tariff.

The only way an exporter "loses" money is if we don't buy as much from them. If we don't buy their steel, it's because we didn't need their steel. If they can't sell their steel to someone else for the same price, then the demand for the steel is not there, and they should lower their output until there is a demand.

Since we are buying the steel, I assume we need it and will continue to buy it even with tariff.

Trudeau is an insult and unacceptable

a reply to: VictorVonDoom

Just another glaring example of a liberal not wanting to pay their own way,Trump is looking out for the US and how it beniefits,how it should be